On July 1st, Amber Japan officially changed its name to S.BLOX. After being acquired by a subsidiary of Singapore-based market maker Amber Group in February 2022 and subsequently by Quetta Web, a wholly-owned subsidiary of Sony Group, in August 2023, the company that operates the cryptocurrency trading service platform "WhaleFin" officially Became part of the Sony Group.
With the purpose of "touching the world with the power of creativity and technology", Sony's business segments include games and network services, music, film and television that "touch people", entertainment, technology and service businesses and imaging that "connect people" and sensing solutions, as well as “people-enabling” healthcare and financial services businesses. In order to highlight the functions of the major industries of this group covering financial services, games and entertainment, in April 2021, Sony changed its name to "Sony Group Corporation", the first name change in more than 60 years.
Among the businesses, Sony’s three major entertainment businesses: games and network services, music, and film and television have developed rapidly in the past ten years. In fiscal year 2021, their overall operating income exceeded half of Sony Group's consolidated operating income for the first time, and their overall operating profit accounted for two-thirds of the group's consolidated profits. With the iterative development of blockchain technology, especially the rise of the Metaverse and NFT, which are closely related to entertainment products, Sony has also begun to cautiously explore and expand into the Web3 field.
As a hot word in the technology circle, the concept of "Metaverse" has begun to enter the vision of many industry companies in 2021. As an entertainment giant, Sony is certainly no exception. In its corporate strategy for fiscal year 2022, Sony anticipates growth in the Metaverse and plans to create new entertainment experiences in this field. Sony CEO Kenichiro Yoshida also revealed that the Metaverse is both a social space and a real-time network space where games, music, movies and animation intersect, and he is interested in launching more products with Metaverse experience for users.
After targeting the then-hot Metaverse track, Sony quickly laid out its plans. First, it signed a three-year cooperation agreement with Premier League champion Manchester City in February 2022 to jointly create the world's first Metaverse football stadium. Later, it was revealed in April that KIRKBI and KIRKBI, the family investment company behind Lego, each invested US$1 billion, investing a total of US$2 billion in Epic Games, betting heavily on the Metaverse. At the end of the same year, Sony acquired Beyond Sports, an AI-based data analysis and visualization company. The latter is positioned as the metaverse sports portal, providing real-time digital sports participation solutions for leagues, broadcasters, brands and final consumers, and drawing from traditional media Even Metaverse Communication provides sports content.
There has been no unified conclusion in the industry about what exactly is the Metaverse and which technologies fall within this conceptual category. In the future of the Metaverse that many people describe, NFT with interoperability and digital asset properties is one of the essential elements. It is believed that this technology can bring real digital ownership, economic activities and social interaction to the Metaverse. In addition, in the foreseeable future, NFT technology has broad application prospects in entertainment products such as games, music, film and television. Therefore, Sony has been interested in the NFT track since 2022.
In April 2022, Sony subsidiary Sony Network Communications established an NFT business company in Singapore. The company is a joint venture between Sony and the software development company Sun Asterisk. Sony Network Communications’ investment ratio is 70%. The newly established company aims to maximize value for customers, creators and end users by leveraging NFT technology in Web3. According to the new company’s website, its business includes “NFT business strategic planning support”, “NFT issuance support”, “unique token issuance support”, “NFT game development support” and “NFT promotion support”.
Sony Music, another section of Sony, has begun to explore the application of NFT technology at least in 2021, and participated in the NFT market MakersPlace’s Series A financing totaling US$30 million that year. In 2022, it first reached a cooperation with Snowcrash, an NFT platform based on Solana (which has been transformed into a music production platform using artificial intelligence), and announced plans to launch a series of NFTs for legendary musicians such as Bob Dylan; and later established the Greater China branch of RCA Records , to explore opportunities in streaming media, NFT and metaverse, signed singers Wang Jiaer and Huang Liling; submitted an NFT-related trademark application for Columbia Records’ logo, and plans to use its trademark for NFT-supported media, music and podcast production, Artist management and music distribution services, etc.
In terms of games, Sony focuses on the research and development of NFT-related patents. The published patents include "Using Tokens on Distributed Ledgers to Track Unique Digital Assets in Games" and "For Transferring and Using Digital Assets Between Game Platforms" NFT Framework", the former describes systems and technologies that can be used to track digital assets across different hardware platforms and works from different issuers, and the latter explores a method for using and trading NFTs across platforms. Sony also stated that it will build an NFT and blockchain system that can be applied to the PlayStation (PS) platform ecosystem.
Entering 2023, Sony seems to be no longer satisfied with the development of NFT technology only, and has further expanded its business scope in the blockchain and Web3 industries.
In early 2023, Sony Network Communications, a business unit of Sony Group, cooperated with the multi-chain smart contract network Astar Network to launch a Web3 incubation plan for practical projects focusing on NFT and decentralized autonomous organizations (DAO) from March to June. The shortlisted projects may be considered for investment by Sony Network Communications. The incubation program is organized by Singapore-based Startale Labs, the development company of Astar Network and founded by Astar CEO Sota Watanabe. (Related reading: "Exclusive interview with the founder of Astar: Sounding the horn of Japan's Web3, "Sony Chain" is about to receive a major update")
However, after the end of the Web3 incubation plan, it was the organizer Startale Labs who clearly got Sony Network Communications $3.5 million investment. In September of the same year, the two parties further deepened their cooperation and established a joint venture subsidiary "Sony Network Communications Labs Pte. Ltd.". The new company will focus on the research and development of blockchain technology. Sota Watanabe said in this regard that the new joint venture subsidiary will promote the development of Sony Chain, which has the potential to surpass the Layer 2 network Base previously released by Coinbase.
At the beginning of this year, Startale Labs raised another US$3.5 million in Series A follow-up financing. Participants included UVM Signum Blockchain Fund, Sony Network Communications and Samsung Next Ventures. The post-financing valuation was US$63.5 million. In addition, according to Singapore's business information platform BIZFILE, the shares of Startale Labs held by Sony Network Communications have been transferred to Sony Group, which to some extent symbolizes that blockchain has reached a new level in Sony's business strategy.
In 2024, Sony began to expand its financial services to the cryptocurrency industry.
In March this year, Sony Bank Co., Ltd., a subsidiary of Sony Financial Group, announced that it plans to release "Sony Bank CONNECT" in the summer of 2024. This new smartphone app, designed to provide privileges to digital securities and NFT holders, is designed to allow any user to access exciting experiences with simplicity and peace of mind. The application will be connected to the market "SNFT" operated by SNFT Co., Ltd., where users can display and enjoy the NFTs they hold in SNFT.
With the product launch, Sony plans to provide digital content to customers who participated in past events and obtained NFTs, purchased specific digital securities, or answered questionnaires. Additionally, they are developing a blockchain-based wallet and plan to continue expanding functionality based on customer feedback after launch. Sony Bank said, "Sony Bank CONNECT will continue to expand its functions based on customer needs after its release in the future, contributing to the future development of Japan's web3 entertainment field."
In addition, Sony Bank has started a proof of concept in April this year. Plans to issue stablecoins pegged to fiat currencies. The trial will be conducted on the Polygon blockchain. It is reported that Sony is exploring the use of stablecoins to promote the company’s intellectual property in the gaming and sports fields due to the advantages of reduced payment and remittance fees. Sony’s stablecoin trial, which will evaluate any legal issues related to the transfer of yen-backed stablecoins, is expected to last several months. The development will be entrusted to Belgium-based blockchain company SettleMint.
The latest news in the cryptocurrency and financial business is that Amber Japan, mentioned at the beginning, was acquired by Sony and was renamed S.BLOX this month. Its future plans to rectify or optimize include: UI screen redesign, new application release, supported currencies and feature expansion.
Since 2021, Sony has been continuously expanding the boundaries of Web3 exploration, from the Metaverse and NFT, to building infrastructure public chains, to contacting cryptocurrency. For a large entertainment group like Sony, it is prudent to integrate emerging technologies into its various business sectors, so as not to be too aggressive and risk too much, nor to be too conservative and be left far behind. This inclusive attitude towards emerging technologies may be the key to its longevity for sixty years.
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